Silver on its way towards historical 16:1 ratio with gold – Sprott


Silver on its way towards historical 16:1 ratio with gold – Sprott  
TORONTO (miningweekly.com) – The price of silver is “on its way” towards a historical price ratio with gold of 16:1, investment guru and precious metals bug Eric Sprott said on Monday.

“And I suspect that it will overshoot this, it might even go to 10:1,” he said at a reception hosted by his Sprott Group of companies, on the sidelines of the annual Prospectors and Developers Association of Canada (PDAC) convention.

“To put that into simple numbers, if the price of gold is $1 600, the price of silver will be $100,” Sprott said.

Silver prices jumped more than 80% in 2010, and the metal has continued rising this year. It reached a 31-year high on Monday of $36,70/oz.

Gold also surged on the day, hitting a new all-time high of $1 445/oz, fuelled by concerns about turmoil in Libya and inflation worries.

Earlier in the day, Sprott told attendees at the PDAC annual mineral outlook luncheon that while gold had been the investment of the last decade, silver will be the top investment of the coming ten years.

Physical supply of the metal is not enough to meet demand, especially growing investment demand for silver, he said.

Comments